Collection agency DP and Associates has agreed with the West Virginia attorney general's office to return $1.7 million in refunds and cancelled debts to consumers in the state, West Virginia officials announced Tuesday.
The Irvine, Calif.-based agency engaged in "unlawful and threatening" debt collection practices and attempted to collect debts without a license, according to McGraw's office.
In January, McGraw's Consumer Protection Division received a complaint against DP and Associates claiming that the company made telephone calls falsely threatening arrest and harassing family members regarding a debt allegedly owed by a consumer.
Investigators reviewing the complaint discovered DP and Associates did not have a license to collect debts in West Virginia. They also found "a pattern of abusive collection methods in which consumers were deceitfully threatened with arrest for non-payment of fabricated debts," according to McGraw's office.
The company will refund all the money it collected, release any judgments it obtained against consumers and close all West Virginia accounts with a zero balance. The company also will notify credit-reporting bureaus to delete references to the debts.
Officials with DP and Associates could not be immediately reached for comment.
In one case, cited by McGraw's office, a Grafton, W.Va.-based woman was led to believe that if she did not pay $3,000 to the company by the end of the day a warrant would be issued for her arrest.
The agency allegedly even went as far as to contact the consumer's mother-in-law and falsely state that representatives were waiting at the Taylor County (W.Va.) courthouse for the arrest of her daughter-in-law, according to McGraw's office. The agency also inflated the alleged amount owed, upping it to $8,000 after specifying it was $5,987.10 in an email.